Yes, HATED characters MIGHT help a story. I never watched Game of Thrones (I see the shock on all your faces), but I understand it was a good show (before the end). EVIL Scum Eric was NOT that kind of character. I'm NOT doing a massive wall of text this time but will just give two MAJOR PROBLEMS created by his appearance that made him not just hated but bad and NOT needed.
1) The game switched from Family Fun to Voyeur/forced to watch someone else with NO warning. The ORIGINAL description by the dev was something like 'the incest game of a lifetime' with NO mention of NTR or voyeur. There was (at the time) NO information in or out of the game that things were going to change. Had there been information whether in or out of the game about the change things might have been (slightly) less damaging.
2) There was NO struggle or competition until LONG after the Evil One's appearance. It took a massive drop in support for the dev to even begin allowing for players to have a (SMALL) chance to avoid/block some of the Eric Characters actions. Heck the BEST thing players and Mod makers could find to BLOCK most of the unwanted content was to follow a LIMITED path to a certain point (Where Eric could be removed) while NOT doing most of the content available. In the end we finally got several ways to REMOVE the character relatively quickly so we could continue. As many have said his part in the game became an annoyance NOT a struggle, and he became hated for the DAMAGE he caused the game, not his role in it.
Let me use a different example to the one you used 'Lord of the Rings'. Would the story have been as loved if, after the main characters were established and their goals shown, a new character (never mentioned before) appeared that changed EVERYTHING? Now the quest was NOT to stop the Dark Lord and save the world. Instead, the new character took the ring, and the story became how this person uses it to conquer the world and create an EVIL empire, all with BAD (or NO) character development and poorly written situations that don't make sense.
Would that be an example of a GOOD character that is hated and situations that evoke emotions in a good way for the story? Would this new version be used to show a good character being added, or instead be seen as a way to DESTROY a story? Yes, a VERY good writer MIGHT be able to create a decent story from that, but it is unlikely, and that did NOT happen here.
A hated character can be good in a story or game if properly developed and they serve a purpose in the game/story. A character who causes chaos and destroys the story/game is hated for the damage they did to something that started good and became BAD when they appeared.
I discovered the original game shortly after it started and ENDURED the situation from before the mess that Eric created until now. The BEST I can say about the EVIL Scum Eric character is that he was POORLY written, UNNECCESARY to the story, and caused a legacy of damage that persists until today.
ACK, I wanted to avoid another wall of text.. -SIGH-
Just some thoughts.
P.S. Just as a throwback for those that remember.. ALL games can be improved by adding Chocolate Chip Cookies!!